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Pickens says Canadians shouldn’t worry about plan to wean U.S. off foreign oil

Thursday, 18 June 2009 - 7:07am

By Lauren Krugel THE CANADIAN PRESS

CALGARY — Canadians need not worry about T. Boone Pickens’ plan to wean the United States off of foreign oil, the Texas billionaire told a Calgary business audience Wednesday.
“It’s going to be good for America. It’s going to be good for Canada. It’s going to be good for the producers. It’s going to be good for everybody,” the 81-year-old oilman said before a room crammed with 770 members of Calgary’s business community.

Pickens said the only loser in the deal is foreign oil.
“And I don’t call you foreign,” he added, eliciting peals of laughter.
The Pickens Plan, introduced last year, calls for the United States to cut its dependence on foreign oil by more than one-third by making natural gas and wind power much bigger parts of America’s energy mix.
The United States receives more crude oil from Canada than any other country.
“It’s just natural, to me, that the United States and Canada work together and we’re, of course, a good customer to the Canadians and it’s easier to sell it to us than anyone else, so it would naturally come here,” Pickens told reporters.
“From our standpoint, we would prefer Canadian oil because it’s more stable than any place in the world. That’s just a natural relationship that I think just grows, and no reason for it to decrease.”
Pickens laid out a rosy outlook for natural gas prices, which traded above US$4 per 1,000 cubic feet on Wednesday, but have languished well below that mark for months.
“I think next year US$7 will be the average price for the year for natural gas. I’m optimistic about the price.”
And Pickens has put his money where his mouth is, recently buying a futures contract for natural gas next year for US$6.02 per 1,000 cubic feet with the expectation of making a dollar off of each unit.
Pickens may be bullish on natural gas, but producers in the United States and Canada have been loath to drill lately due to the lacklustre prices.
When asked whether more natural gas production would press prices even lower and make the economics for producers even less attractive, Pickens appeared incredulous.
The low prices would make natural gas competitive with coal as a fuel for power plants, which would soak up much of the extra supply, he said.
“It’s such a valuable fuel. It’s the best of all hydrocarbons. I’m not going to worry about it getting too much,” he told reporters.
The continental United States has enormous supplies of natural gas, especially in the Barnett formation in the Fort Worth region of Texas.
Emerging shale plays, recently made accessible by technological breakthroughs, like the Haynesville in Louisiana and the Marcellus in Pennsylvania would add to that amount.